Affordable Housing Credit Improvement Act Introduced in Senate, House

Thursday, May 11, 2023 - 12:45PM

Bipartisan legislation to strengthen and expand the low-income housing tax credit (LIHTC) was introduced today in both houses of Congress. The Affordable Housing Credit Improvement Act (AHCIA) of 2023 would restore the 12.5% LIHTC cap increase that expired in 2021 and further increase allocations by 50% over two years; decrease the private-activity bond (PAB) financed-by test from 50% to 25%; provide basis boosts for rural and Tribal developments and properties for extremely low-income residents; and authority for states to grant a discretionary boost to make certain properties financially feasible. The legislation–introduced by four senators (two Democrats and two Republicans) and six Representatives (three Democrats, three Republicans), is similar to a version introduced in 2021. Text of the legislation was not immediately available, but sponsors released a one-page summary, detailed bill summary and a document listing differences between this version and the previous version.

A Notes from Novogradac blog post analyzes the legislation and provides a Novogradac forecast that the legislation could finance more than 1.9 million additional affordable rental homes over 10 years.

The Novogradac Introduction to Low-Income Housing Tax Credit booklet provides a brief, but substantive look at the LIHTC.

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